After facing a major backlash, Tesla (TSLA) CEO Elon Musk has admitted that his recent comments about President Trump “went too far,” which is a move that was likely aimed at protecting both his personal wealth and Tesla’s relationship with the U.S. government. As a result, his apology helped Tesla shares extend their three-day rally by rising another 1.7% at the time of writing and recovering 23% of the company’s market value since its June 5 low. It remains unclear whether the feud was a genuine clash of egos or a calculated effort by Musk to separate Tesla from Trump’s brand.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Indeed, since Musk took on the role of “special government employee” focused on cutting government waste, Tesla shares have dropped, dealerships have been vandalized, public opinion has soured, and Musk has even faced death threats. In addition, the conflict with Trump had become a major overhang on Tesla stock, with investors worried that Trump might retaliate by creating regulatory roadblocks for Tesla’s autonomous driving ambitions and Musk’s other ventures. As four-star Wedbush analyst Dan Ives put it, “Musk needs Trump and Trump needs Musk.”
Unsurprisingly, Ives emphasized that repairing this relationship is crucial, especially as Tesla prepares for the launch of its robotaxi service in Austin on June 22. “The vast majority of valuation upside for Tesla depends on the success of its autonomous vision,” Ives noted. Therefore, a cooperative relationship with Trump will be essential for securing the federal framework needed to support that vision. Ives also believes that this could be the start of Tesla’s path toward a $2 trillion valuation that will be driven by full self-driving, widespread adoption of autonomy, and the U.S. rollout of its Cybercab service.
What Is the Prediction for Tesla Stock?
Overall, analysts have a Hold consensus rating on TSLA stock based on 14 Buys, 12 Holds, and nine Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average TSLA price target of $285.97 per share implies 13.6% downside risk.
